While we were all distracted by the life and death of COVID19, our friends at Facebank have made a few changes in their quest to make Libra a viral offering in the crypto world.
You will recall that we spoke of Facebank’s Libra offering here:
Facebank And Libra
Cracks In The Libra Foundation
Libra Foundation Crack Update
Libra V The Senate
So, recently we learn that Facebank, with its newly trimmed roster of supporters, has made a slight pivot. The pivot is driven by the reality of the political and regulatory pushback.
In other words, creating Libra isn’t the two handed dunk shot Facebank, et al, thought it would be.
What are the changes, Big Red Car?
Here are the changes announced recently.
1. Facebank will not make its Libra token the big dog in its digital payments scheme. They are not abandoning Libra, the token.
2. The Libra undertaking will now focus on supporting existing fiat currencies — talking US Dollar and Euro — and the Libra token when it is finally approved.
[Do not hold your breath on the “approval” of the Libra token, but nod knowingly and pretend it will happen.]
3. Core to the admin of the Libra token and Facebank was the Calibra digital wallet. That too will be modified.
Where once it was to be the primary locus for Libra, now it will support multiple currencies of which Libra will just be one — if and when it is launched.
4. Where once upon a pipedream, Libra was to launch in late 2019 or early 2020 — launch will now be October 2020.
Haha, OK, Facebank, we believe that.
5. Oh, yeah, and where the Calibra digital wallet was going to be universally available — with plans for the moon and Mars — now it will only be available in those countries whose fiat currencies are part of the Libra support system.
So, it sounds like a slightly cooler PayPal to me, but with a built in customer base of 2.5B Facebook customers. You?
What was the original plan, Big Red Car?
To refresh your memory: Facebank — a consortium of Facebook and other companies in the same space — announced Libra, a token, to revolutionize money transfer and to create a new blockchain-based digital payments industry.
Remember that Facebank has 2.5B members, so that is a big slice of exposure from the beginning. The Facebank sponsorship is huuuuuuuuuuuuuuuge. They have the members. Instant credibility.
Libra was to be like Bitcoin, but with a bunch of tweaks to make it more stable and less speculative. It was to be fully backed by fiat currencies.
The blockchain would impart complete decentralized transaction verification and ownership of tokens. This is what blockchain does.
It was to be a better mouse trap.
It would operate out of Zurich, Switzerland and would be run by a non-profit called the Libra Association.
So, what happened, Big Red Car?
What happened, dear readers, was that the initial reception met with a fierce backlash from the fiat currency countries who were skeptical about the Facebank sponsorship and what they described as a super-sized influence.
Nations are always concerned about crime, the dark web, tax evasion, financial anonymity as an element of the preceding, and control.
Nations like to control their banking environments and the idea of a non-profit operating out of Zurich controlled by Facebank and others of the same ilk naturally made the regulators concerned.
Facebook also ran into privacy concerns that bubbled to American Congressional notice — not a good development.
The whole thing began to smell like a bank and that made countries even more concerned because banks have to apply for charters, be granted charters, subject themselves to regular inspection, and operate within strict, sometimes political, guidelines and laws.
So, what did Facebank do?
They tried to appease the regulators. What you are seeing today is their first attempt at appeasement.
Bottom line it, Big Red Car?
Back in the day, your Big Red Car said:
“This deal will not launch in Spring 2020. Not a chance. This is going to require political support and the entire political infrastructure of the United States is already focused on the 2020 election.”
This paragraph was uttered in June 2019 when Facebank and Libra were at the height of their super powers.
So, dear readers, there you have it.
But, hey, what the Hell do I really know anyway? I’m just a Big Red Car. Be good and wash your hands.